Chancellor Alistair Darling: 'I remain confident that we will see a return to growth at the turn of the year.' Photograph: Toby Melville/Reuters

Alistair Darling insists the recession will be over by Christmas, despite growing doubts over his economic forecasts.

In an interview with the Times, the chancellor stuck by his predictions, even though other forecasters, including the International Monetary Fund, have published a much gloomier assessment of the economy.

"I am not going to change my forecasts," Darling said. "I remain confident that we will see a return to growth at the turn of the year."

In last month's budget, Darling predicted the economy would shrink by 3.5% this year and surprised the City when he forecast a rapid economic recovery, with growth of 1.25% in 2010 and the year after.

Since then, government figures have shown a shock 1.9% plunge in Britain's gross domestic product in the first three months of this year - the sharpest decline in almost three decades.

The IMF does not share the chancellor's optimism and believes the economy will continue to shrink next year. It has forecast falls of 4.1% in output this year and 0.4% in 2010.

Darling argued that, while the IMF and the Bank of England have taken a "more cautious" view, the shape of their forecasts is similar to the Treasury's.

"I delivered my budget statement four weeks ago," he said. "None of the figures I have seen since would change the projections that I have made."

The government's benchmark consumer price index, which excludes housing costs, still stands at 2.3%, above the Bank of England's 2% target. Darling said the fall in inflation "is in line with expectations. Deflation is something quite different".

He pinned his hopes on the rescue package agreed by the G20 major economies last month, saying: "I remain confident that we will come through this, provided we ensure that we deliver what we set out at the G20, and what we are doing ourselves, particularly in relation to ensuring that the bank-lending agreements are fully implemented. That is very, very important."

He welcomed early signs that bank lending had begun to resume. "What I expect is that, over the course of this year, you will see a gradual improvement, but we have still got to be vigilant," he said.

"The lending agreements are there. We have got to make sure they are delivered."

Darling played down suggestions that the government could start selling its stakes in Royal Bank of Scotland and Lloyds Banking Group within a year, saying he was in "no hurry" as he wanted to get the "best possible deal for the taxpayer".

The chancellor also indicated that he hoped to stay at the Treasury despite talk that he could be moved to the Home Office or Foreign Office in a reshuffle this summer. He said: "The job is not done. This is very much work in progress."